US shutdown forces Obama to cancel Asia stops

WASHINGTON (AP) — The U.S. government shutdown forced President Barack Obama on Wednesday to cancel two stops on a long-planned trip to Asia and left federal services in limbo across the country. Lawmakers from both parties suggested the impasse could last for weeks and encompass a potentially more dangerous fight over the country’s borrowing limit.

Funding for much of the government was cut off Tuesday after a Republican effort to thwart Obama’s health care law stalled a short-term, normally routine spending bill. Republicans pivoted to a strategy to try to reopen the government piecemeal but were unable to immediately advance the idea in the House of Representatives.

Nearly a third of the federal workforce — some 800,000 employees — was forced off the job, closing down services from informational websites to national parks. People classified as essential employees — such as air traffic controllers, Border Patrol agents and most food inspectors — continued to work.

The increasingly entrenched standoff — and especially concerns of a looming debt limit crisis — rattled stock markets that had largely shrugged off the shutdown on its first day. Stock indexes fell in Germany and France, while Wall Street was headed for a lower opening, with stock futures falling sharply.

Obama, who is scheduled to leave Saturday night for Asia, called off the final two stops in Malaysia and the Philippines. He will still travel to Indonesia and Brunei.

National Security Council spokeswoman Caitlin Hayden said that since Malaysia and the Philippines were “on the back end of the President’s upcoming trip, our personnel was not yet in place and we were not able to go forward with planning.”

Hayden added: “The cancellation of this trip is another consequence of the House Republicans forcing a shutdown of the government. This completely avoidable shutdown is setting back our ability to promote U.S. exports and advance U.S. leadership in the largest emerging region in the world.”

Republican leaders faulted the Democratic-led Senate for killing a request from the Republican-controlled House request to open official negotiations on the temporary spending bill. Senate Democrats insist that Republicans give in and pass their straightforward funding bill.

Obama planned Wednesday to host chief executives of the nation’s 19 largest financial firms, trying to highlight big business opposition to the shutdown. The U.S. Chamber of Commerce had sent a letter to Congress urging no shutdown and warning against a debt ceiling crisis that they say could lead to an economically disastrous default. The president is eager to employ the business groups to portray House Republicans as out of touch with even their long-established corporate patrons.

The budget dispute has divided the Republican Party. A core of conservative activists have led a passionate charge against the 2010 health care law, arguing it is hurting jobs and restricting freedom by requiring most Americans to have health insurance. But other Republicans fear the party will be blamed for the shutdown and face the consequences in next year’s congressional elections.

Rep. Peter King, a New York Republican, charged Wednesday that House members aligned with the small-government tea party movement are trying to “hijack the party.”

King said he senses that increasing numbers of House Republicans — perhaps as many as a hundred — are growing weary of that wing of the party. He told MSNBC there are meetings among Republican lawmakers Wednesday with the aim of resolving the stalemate.

In an opinion piece Wednesday’s USA Today, the Republican leader of the House, Speaker John Boehner, criticized the Democrats for refusing to negotiate. “We hope that Senate Democrats — and President Obama — change course and start working with us on behalf of the American people,” he said.

Late Tuesday, House Republicans sought passage of legislation aimed at reopening small slices of the government, including the national parks. The move presented Democrats with politically challenging votes but they rejected the idea, saying Republicans shouldn’t be permitted to choose which agencies should open and which remain shut.

Unaffected by the shutdown, a key part of the health plan took effect Tuesday. Health insurance exchanges opened online across the country to take applications for coverage that would start Jan. 1. The new law is intended to extend coverage to the millions of Americans now uninsured.

Republicans said there could be more votes Wednesday, perhaps to allow the National Institutes of Health to continue pediatric cancer research. The NIH’s hospital of last resort wasn’t admitting new patients because of the shutdown. Dr. Francis Collins, agency director, estimated that each week the shutdown lasts would force the facility to turn away about 200 patients, 30 of them children, who want to enroll in studies of experimental treatments.

Republicans hoped such votes would create pressure on Democrats to drop their insistence that they won’t negotiate on the spending bill or an even more important subsequent measure, required in a couple of weeks or so, to increase the government’s borrowing limit.

There were suggestions from leaders in both parties that the shutdown could last for weeks and grow to encompass the measure to increase the debt limit

“This is now all together,” said Sen. Dick Durbin, a Democrat. Rep. Paul Ryan, the Republican House Budget Committee Chairman, added: “I’ve always believed it was the debt limit that would be the forcing action.”

The U.S. risks a market-rattling, first-ever default on its obligations if Congress fails to raise the limit.